-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, GzrEo6NV3Gc+3Z/hL0CIPbFBQVRaHBOjNkOsSe8/aEcYwrMWaX1hAdDf12Y2hmV6 wOsA6r6okgyonoSbEVoCbA== 0001047469-98-031764.txt : 19980817 0001047469-98-031764.hdr.sgml : 19980817 ACCESSION NUMBER: 0001047469-98-031764 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19980731 ITEM INFORMATION: ITEM INFORMATION: FILED AS OF DATE: 19980814 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: RIMAGE CORP CENTRAL INDEX KEY: 0000892482 STANDARD INDUSTRIAL CLASSIFICATION: COMPUTER PERIPHERAL EQUIPMENT, NEC [3577] IRS NUMBER: 411577970 STATE OF INCORPORATION: MN FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: SEC FILE NUMBER: 000-20728 FILM NUMBER: 98691327 BUSINESS ADDRESS: STREET 1: 7725 WASHINGTON AVE S CITY: EDINA STATE: MN ZIP: 55439 BUSINESS PHONE: 6129448144 MAIL ADDRESS: STREET 1: 7725 WASHINGTON AVENUE SOUTH CITY: EDINA STATE: MN ZIP: 55439 8-K 1 FORM 8-K FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) or the Securities Exchange Act of 1934 Date of Report (date of earliest event reported): July 31, 1998 RIMAGE CORPORATION (Exact name of Registrant as specified in its charter) Minnesota 0-20728 41-1577970 --------- ------- ---------- (State or other jurisdiction (Commission (I.R.S. Employer of incorporation) File Number) Identification No.) 7725 Washington Avenue South, Edina, MN 55439 ---------------------------------------------- (Address of principal executive offices including zip code) Registrant's telephone number, including area code: (612) 944-8144 Not applicable ------------------------------------------------------------ (Former name or former address, if changed since last report) RIMAGE CORPORATION AND SUBSIDIARIES Unaudited Pro Forma Condensed Consolidated Financial Statements Basis of Presentation The unaudited pro forma condensed consolidated statements of operations for the year ended December 31, 1997 and for the six months ended June 30, 1998, present the operating results of Rimage Corporation (the "Company"), excluding the operations related to the assets of its Minnesota services business (the "Assets"), as if the Assets had been sold at the beginning of the respective periods. The pro forma condensed consolidated balance sheet has been prepared assuming the sale of the Assets took place as of June 30, 1998. The unaudited pro forma condensed consolidated statements of operations, the balance sheet, and the notes thereto should be read in conjunction with the Company's audited consolidated financial statements and notes thereto, incorporated by reference from the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1997, and the unaudited consolidated financial statements and notes thereto incorporated by reference from the Company's Quarterly Report on Form 10-Q for the quarter ended June 30, 1998. The unaudited pro forma information is not necessarily indicative of the results of operations or financial position that would have resulted had the sale occurred as described above, nor is it necessarily indicative of the results of operations of future periods or future financial position. F-1 RIMAGE CORPORATION AND SUBSIDIARIES Pro Forma Condensed Consolidated Balance Sheet June 30, 1998 (Unaudited)
PRO FORMA PRO FORMA ASSETS HISTORICAL ADJUSTMENTS RESULTS - ------------------------------------------------------------------------------------------------------------------------ Current assets: Cash and cash equivalents $ 3,187,705 518,574 (A) $ 3,706,279 Trade accounts receivable, net of allowance for doubtful accounts and sales returns of $328,738 5,053,008 5,053,008 Inventories 2,520,098 2,520,098 Prepaid expenses and other current assets 849,703 849,703 ------------ ------------ Total current assets 11,610,514 12,129,088 ------------ ------------ Property and equipment, net 5,139,572 (2,369,669) (A) 2,769,903 Other noncurrent assets 947,908 947,908 ------------ ------------ Total assets $ 17,697,994 $ 15,846,899 ------------ ------------ ------------ ------------ LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Current portion of notes payable $ 900,000 $ 900,000 Current installments of capital lease obligations 388,190 (314,442) (A) 73,748 Trade accounts payable 2,553,666 2,553,666 Accrued expenses 1,532,575 (71,872) (A) 1,460,703 Income taxes payable 492,680 492,680 Deferred income and customer deposits 683,393 683,393 ------------ ------------ Total current liabilities 6,550,504 6,164,190 Notes payable, less current portion 300,000 300,000 Capital lease obligations, less current installments 2,461,064 (1,012,453) (A) 1,448,611 ------------ ------------ Total liabilities 9,311,568 7,912,801 ------------ ------------ Minority interest in inactive subsidiary 57,907 57,907 Stockholders' equity: Common stock 31,599 31,599 Additional paid-in capital 10,781,157 10,781,157 Accumulated deficit (2,354,208) (452,328) (A) (2,806,536) Foreign currency translation adjustment (130,029) (130,029) ------------ ------------ Total stockholders' equity 8,328,519 7,876,191 ------------ ------------ Total liabilities and stockholders' equity $ 17,697,994 $ 15,846,899 ------------ ------------ ------------ ------------
F-2 RIMAGE CORPORATION AND SUBSIDIARIES Pro Forma Condensed Consolidated Statement of Operations For the Six Months Ended June 30, 1998 (Unaudited)
PRO FORMA PRO FORMA HISTORICAL ADJUSTMENTS RESULTS - ------------------------------------------------------------------------------------------------------------------------ Revenues $ 18,489,889 (550,133) (B) $ 17,939,756 Cost of revenues 10,962,842 (575,217) (B) 10,387,625 ------------ ------------ Gross profit 7,527,047 7,552,131 ------------ ------------ Operating expenses: Engineering and development 916,877 916,877 Selling, general and administrative 3,947,931 3,947,931 ------------ ------------ Total operating expenses 4,864,808 4,864,808 ------------ ------------ Operating earnings 2,662,239 2,687,323 ------------ ------------ Other (expense) income: Interest, net (157,878) 82,818 (C) (75,060) Other, net 66,849 66,849 ------------ ------------ Total other expense, net (91,029) (8,211) ------------ ------------ Earnings before income taxes 2,571,210 2,679,112 Income tax expense 520,200 5,017 (B) 541,780 16,564 (C) ------------ ------------ Net earnings $ 2,051,010 $ 2,137,332 ------------ ------------ ------------ ------------ Basic net earnings per common share $ 0.66 $ 0.69 ------------ ------------ ------------ ------------ Diluted net earnings per common share and common share equivalent $ 0.57 $ 0.60 ------------ ------------ ------------ ------------ Basic weighted average shares 3,118,012 3,118,012 ------------ ------------ ------------ ------------ Diluted weighted average shares and share equivalents outstanding 3,572,562 3,572,562 ------------ ------------ ------------ ------------
F-3 RIMAGE CORPORATION AND SUBSIDIARIES Pro Forma Condensed Consolidated Statement of Operations For the Year Ended December 31, 1997 (Unaudited)
PRO FORMA PRO FORMA HISTORICAL ADJUSTMENTS RESULTS - ------------------------------------------------------------------------------------------------------------------------ Revenues $ 38,878,439 (3,184,139) (B) $ 35,694,300 Cost of revenues 27,559,498 (2,563,048) (B) 24,996,450 ------------ ------------ Gross profit 11,318,941 10,697,850 ------------ ------------ Operating expenses: Engineering and development 1,904,490 1,904,490 Selling, general and administrative 6,575,558 6,575,558 ------------ ------------ Total operating expenses 8,480,048 8,480,048 ------------ ------------ Operating earnings 2,838,893 2,217,802 ------------ ------------ Other (expense) income: Interest, net (829,490) 186,352 (C) (643,138) Other, net 35,813 (452,328) (A) (416,515) ------------ ------------ Total other expense, net (793,677) (1,059,653) ------------ ------------ Earnings before income taxes 2,045,216 1,158,149 Income tax expense 120,143 (90,466) (A) (57,270) (124,218) (B) 37,270 (C) ------------ ------------ Net earnings $ 1,925,073 $ 1,215,419 ------------ ------------ ------------ ------------ Basic net earnings per common share $ 0.62 $ 0.39 ------------ ------------ ------------ ------------ Diluted net earnings per common share and common share equivalent $ 0.59 $ 0.37 ------------ ------------ ------------ ------------ Basic weighted average shares 3,086,292 3,086,292 ------------ ------------ ------------ ------------ Diluted weighted average shares and share equivalents outstanding 3,276,539 3,276,539 ------------ ------------ ------------ ------------
F-4 RIMAGE CORPORATION AND SUBSIDIARIES Notes of Pro Forma Condensed Consolidated Financial Statements (Unaudited)
(A) Cash and Cash Equivalents 518,574 Accrued Expenses 71,872 Loss on sale of fixed assets/Retained Earnings 452,328 Current Installments of Capital Lease Obligation 314,442 Capital Lease Obligation, Less Current Installment 1,012,453 Property and Equipment, net (2,369,669)
To record fixed asset sale to ADS and buyout of associated capital lease obligation (B) To reflect reduction in revenues and expenses and increase/decrease in net income associated with the sale of CD-ROM equipment to ADS (C) To reflect the reduction in interest expense associated resulting from the buyout of capital lease obligation; and reflect assumed interest income earned on net cash proceeds remaining after sale of CD-ROM equipment and buyout of capital lease. Assume interest income earned on cash is 5% per annum F-5 Item 2. Acquisition or Disposition of Assets. On July 31, 1998, Rimage Corporation ("Rimage") completed the sale of a substantial portion of its CD-ROM duplicating equipment and a portion of its diskette duplication equipment used in its Minnesota services business to Advanced Duplication Services, Inc. ("ADS") for a sales price of approximately $1.9 million in cash. This services location had revenues of approximately $3.7 million and a net operating loss of $50,000 during the six months ended June 30, 1998. Rimage will record a loss of approximately $460,000 on the sale of the assets in the quarter ending September 30, 1998. Rimage Corporation is a leading provider of systems and services for the publication of information on CD-R, CD-ROM, diskette and tape. Item 7. Financial Statements. (a) Financial Statements. Not applicable (b) Pro Forma Financial Information:
Basis of presentation. . . . . . . . . . . . . . . . . . . . . . . F-1 Unaudited Pro Forma Condensed Consolidated Balance Sheet as of June 30, 1998 . . . . . . . . . . . . . . . . . . . . . . . . F-2 Unaudited Pro Forma Condensed Consolidated Statement of Operations for the Six Months Ended June 30, 1998. . . . . . . . . . . . F-3 Unaudited Pro Forma Condensed Consolidated Statement of Operations the Year Ended December 31, 1997. . . . . . . . . . . . . . . F-4 Notes to Unaudited Pro Forma Condensed Consolidated Financial Statements. . . . . . . . . . . . . . . . . . . . . . . . . . F-5
(c) Exhibits. 10.1 Bill of Sale Agreement dated as of July 31, 1998 by and between Rimage and ADS. SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. RIMAGE CORPORATION By /s/ Bernard P. Aldrich By /s/ Robert M. Wolf ---------------------- ------------------ Bernard P. Aldrich, Director, Chief Robert M. Wolf Executive Officer, and President Controller Dated: August 14, 1998 EX-10.1 2 EXHIBIT 10.1 BILL OF SALE This BILL OF SALE is made and entered into as of the 31st day of July, 1998, by and between RIMAGE SERVICES GROUP ("Transferor"), a division of Rimage Corporation, a Minnesota corporation, located at 9701 Penn Avenue South, Bloomington, Minnesota 55431, and ADVANCED DUPLICATION SERVICES, INC. ("Transferee"), a Minnesota corporation, located at 2155 Niagara Lane North, Suite 120, Plymouth, Minnesota 55447. WITNESSETH: WHEREAS, Transferee wishes to acquire, and Transferor wishes to sell, transfer and convey to Transferee, all of Transferor's right, title and interest in and to the equipment listed on Schedule A hereto (collectively, the "Equipment"); NOW, THEREFORE, in consideration of the premises and the covenants and agreements set forth herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto covenant and agree as follows: 1. Transferor hereby irrevocably sells, grants, assigns, transfers, conveys, delivers and sets over unto Transferee any and all of its right, title and interest in the Equipment, subject to the following liens, claims and encumbrances: none 2. Transferor hereby represents, warrants and covenants that (a) it is the owner of good, marketable title to the Equipment, (b) the Equipment is free from all liens and encumbrances (except as listed above) and (c) Transferor has the right to sell and convey the Equipment to Transferee. Transferor shall warrant and defend the sale of the Equipment to Transferee against any and all persons who claim title to the Equipment, subject only to the encumbrances listed above. Transferor hereby indemnifies and holds Transferee harmless from, against and in respect of (and on demand shall reimburse Transferee for) any and all loss, liability or damage (including reasonable attorney's fees) suffered or incurred by Transferee by reason of any untrue representation, breach of warranty or nonfulfillment of any covenant by Transferor contained herein or in any certificate, document or instrument delivered to Transferee pursuant hereto or in connection herewith. 3. Other than is stated above, Transferor makes no express warranties, makes no implied warranties and disclaims any warranties of merchantability or fitness for the purpose, and Transferee understands that the Equipment is being sold and transferred AS IS, WHERE IS. 4. This Bill of Sale shall be construed and interpreted, and the rights of the parties determined in accordance with, the laws of the State of Minnesota, without reference to conflicts of law principles thereunder. 5. All of the covenants and agreements contained herein shall apply to and bind the Transferor and benefit the Transferee and their respective successors and assigns. IN WITNESS WHEREOF, the parties hereto have caused this Bill of Sale to be duly executed and delivered by their respective duly authorized officers, as of the day and year first above written. RIMAGE SERVICES GROUP ADVANCED DUPLICATION SERVICES, INC. By: /s/ Bernard P. Aldrich By: /s/ Mike Bernstein ------------------------------- ------------------------------- Bernard P. Aldrich Mike Bernstein Its President and CEO Its Chief Executive Officer By: /s/ Kathy Peterson ------------------------------- Kathy Peterson Its Chief Operating Officer 2 -----END PRIVACY-ENHANCED MESSAGE-----